SP500 closed Monday at 1.192.46. A close below 1.200 is another strong indication that the market will fall further. It is very important to note that a gap always will be covered. Usually this happens when a bottom has been created on the 2 hr chart and the falling 8 days MA will not be confronted. This 8 day MA gets lower by the day but for Tuesday and Wednesday it has not come down to the gap point. The gap point that a rally must reach for SP500 is at 1.210.46. All indexes have gap points so do not get surprised if a rally comes up to this level which is very near last Friday's close. The gaps were created because the Asian opening was below Fridays lowest point.
The big drop came early Monday, between CET 08:00 - 16:00. Trading after that until close at 22:00 was used by the market to move sideways and by that behavior creating the beginning of a bottom which when ready could be a starting point for a rally. Remember also that many players have short positions all the way up to Friday close. These short positions have electronic stop points for the short positions to be bought. In a rally, which usually is handled by the big boys everything goes very quickly and most of the time it is unexpected.
There are also many traders prepared to take new short positions when the rally runs out of steam. The time during this Thanksgiving week is perfect for such a rally because of small turnover.
I do not know when this rally will occur it could be Tuesday, Wednesday or some day in late December. It can also come any of the 21 hours SP500 is traded and you must be lucky to sit at your screen if you want to short the top.
The big drop came early Monday, between CET 08:00 - 16:00. Trading after that until close at 22:00 was used by the market to move sideways and by that behavior creating the beginning of a bottom which when ready could be a starting point for a rally. Remember also that many players have short positions all the way up to Friday close. These short positions have electronic stop points for the short positions to be bought. In a rally, which usually is handled by the big boys everything goes very quickly and most of the time it is unexpected.
There are also many traders prepared to take new short positions when the rally runs out of steam. The time during this Thanksgiving week is perfect for such a rally because of small turnover.
I do not know when this rally will occur it could be Tuesday, Wednesday or some day in late December. It can also come any of the 21 hours SP500 is traded and you must be lucky to sit at your screen if you want to short the top.
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